Turkey turns

Turkish President Recep Tayyip Erdoğan crowed triumphant after his Justice and Development Party (AKP)’s Sunday election victory, but the rest of the world should mourn. The AKP victory confirms not democracy, but rather dictatorship.

The election was a farce. In any election, AKP cheating gives it an extra five percent or so bonus. That figure, cited privately by Turkish politicians, diplomats, and veteran Turkish journalists, takes into account stuffed ballots, lost ballot boxes from opposition-held areas, voter suppression and — in yesterday’s election — enough registered dead people to make a corrupt Chicago politician blush.

People wave flags and hold a portrait of Turkish President Tayyip Erdogan as they wait for the arrival of Prime Minister Ahmet Davutoglu in Ankara, Turkey November 2, 2015. REUTERS/Umit Bektas.

Erdoğan long ago became the Turkish equivalent of corrupt Russian leader Vladimir Putin, minus the polonium tea (at least until he gets his hands on some polonium). He has sworn “to raise a religious generation,” and he will now succeed. Now, he seeks to change the constitution to confirm his position as sultan-in-chief. Some diplomats comfort themselves with the fact that Erdoğan’s new parliamentary majority falls short of that needed to simply impose constitutional change, and even short of that needed to call a referendum. These analysts make the mistake of assuming that Erdoğan respects institutions or plays by the rules. He is within easy bribery of the additional 15 votes he needs for a referendum, and can fix any ballot to conform to his desired results. It’s just a matter of time.

So what next for Turkey?

• Prolonged Kurdish conflict. Erdoğan first legitimized PKK leader Abdullah Öcalan by opening negotiations with him, and then undercut the Kurdish peace process for his own short-term political gain. Suppressing the Kurdish vote also convinced many Kurds that they had no democratic outlet; it is hard to blame Kurds for concluding they have no choice but fight. Regardless, time is on the Kurds’ side. Erdoğan once benefited from the high birth rates of his followers but now it’s the Kurds’ turn. Demography is on their side. That the Turkish Army is a shadow of its former self and that many Turks don’t want to send their children to die needlessly fighting the Kurds underscore the inevitable.

• Terror sponsorship. President Barack Obama and Secretary of State John Kerry may believe themselves sophisticated for denying the obvious, but Turkey is a state sponsor of terrorism. It has become Pakistan on the Mediterranean. Erdoğan supports the Islamic State, Hamas, jihadist terror in Sudan and, to some extent at least, Al Qaeda in the Islamic Maghreb and Boko Haram. Erdoğan is an ideologue, and he will not hesitate to kill people to promote hatred and intolerance.

• Turkey as terror victim. Every country that has sponsored Islamist terrorism ultimately has suffered blowback. Saudi Arabia did not crack down seriously on Al Qaeda until Bin Laden’s minions turned on their former benefactors in the years immediately following 9/11. Syrian President Bashar al-Assad transformed his country into an underground railroad for foreign fighters seeking to wage jihad in Iraq, never recognizing they could just as easily turn on him. Turkey’s support for the Islamic State and Al Qaeda affiliates inside Syria will, in the long term, claim the lives of thousands inside Turkey. The recent bombings in Ankara and beheading in southeastern Turkey should send chills down the spine of anyone betting on Turkish stability.

• Gender segregation. The chief victims of Erdoğan’s strengthened rule will be women. Erdoğan has made clear his view that women should have three babies, and he has called birth control “treason,” and systematically excluded women from government service. He has even declared a war on Caesarean sections, as they deny God’s will.

• Further erosion of press freedom. Erdoğan despises the press. He has not only transformed Turkey into “the world’s largest prison for journalists,” but has been increasingly shameless in his efforts, seizing opposition newspapers and shutting down independent television stations mid-broadcast. Many journalists will retire or flee; others make moral compromise. Cengiz Çandar, for example, a columnist for Radikal and a veteran of both the Woodrow Wilson International Center for Scholars and the US Institute of Peace, went so far as to endorse the arrests of his fellow journalists. Turkey has already fallen behind Russia in press freedom, no easy feat; it is well on its way to falling behind Iran. How low it can go is anyone’s guess, as Erdoğan even turns to punishing thought-crimes.

• The economic bubble will burst. The Turkish economy is on borrowed time, and perhaps a covert Qatari line of credit. When the Turkish economy imploded in 2000-2001, Turks turned to Erdoğan, who promised an end to corruption and a technocratic fix. This time around, they will have nowhere to turn. To invest in Turkey is akin to investing in Russia: Expect to lose money. The question for the world is, what might Erdoğan do to distract from the looming disaster?

Obama at first embraced Erdoğan and then chose to ignore him. The new US president will not have such a luxury.

He or she will have to answer some very basic questions about the US approach to Turkey. It’s time to plan for a world where Turkey is an adversary and a catalyst for regional instability, not a pillar upon which to rely.

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How would Cardin’s VAT affect Social Security recipients?

On December 11, 2014, Senate Finance Committee member Benjamin L. Cardin, D-Md., introduced S. 3005, the Progressive Consumption Tax Act of 2014, which calls for the adoption of a 10 percent VAT. The adoption of a VAT would have far-reaching effects on the economy, including the Social Security program.

In a recent Tax Notes article, Blaise Sonnier and Nancy Nichols discuss the impact of the proposed VAT on Social Security recipients and other groups. Unfortunately, an important part of their analysis of the VAT’s impact on Social Security recipients is incorrect. Their assertion that the tax would reduce current retirees’ real benefits by 10 percent is invalid because the program’s automatic cost of living adjustment would compensate the retirees for any price increase caused by the VAT.

Sonnier and Nichols’ analysis is closer to the mark for future recipients, however, as the proposed VAT would reduce their real benefits by 9.09 percent. The benefit reduction would occur through the VAT’s effect on real wages, which play a crucial role in the formula determining recipients’ real benefits. Examination of the Social Security benefit formula reveals that a VAT has significantly more adverse effects on recipients who turn 60 in the year in which the tax is introduced than on those who turn 60 in the preceding year. To prevent that unwarranted disparity and other unintended interactions with the Social Security program, the adoption of a VAT should be accompanied by appropriate revisions to the Social Security tax and benefit structure.

 

Tax Notes subscribers can read the full article here.

Non-subscribers can read the article on this page on November 16.

 

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Are Democratic presidents really better for the economy than Republican ones?

Partisans are likely to focus on these stats in Paul Krugman’s latest column: Since 1947, “the economy grew, on average, 4.35 percent per year [under Democrats]; under Republicans, only 2.54 percent.”

Democratic presidential candidate Hillary Clinton pauses during a speech in Charleston, South Carolina, October 31, 2015. REUTERS/Randall Hill.

To his credit, Krugman does not make strong claims about the superiority of Democratic economic management (though he does mock current GOP policy proposals). Neither does the 2014 study, from where those numbers come, “Presidents and the U.S. Economy: An Econometric Exploration.”  Authors Alan Blinder and Mark Watson sort of give it the old ¯\_(ツ)_/¯:

Democrats would no doubt like to attribute the large D-R growth gap to macroeconomic policy choices, but the data do not support such a claim. If anything, and we would not make too much of small differences, both fiscal and monetary policy actions seem to be a bit more stabilizing when a Republican is president — even though Federal Reserve chairmen appointed by Democrats preside over faster growth than Federal Reserve chairmen appointed by Republicans by a wide margin.

It seems we must look instead to several variables that are mostly “good luck,” with perhaps a touch of “good policy.” Specifically, Democratic presidents have experienced, on average, better oil shocks than Republicans (some of which may have been induced by foreign policy), a better legacy of productivity shocks, more favorable international conditions, and perhaps more optimistic consumer expectations (as measured by the Michigan ICE). These factors together explain slightly more than half of the 1.80 percentage point D-R growth gap. The rest remains, for now, a mystery of the still mostly-unexplored continent.

Thoughts:

1) Policy matters. But sometimes it takes a while to matter. And the world is a complicated place. So teasing out cause and effect is difficult.

What was the impact of the Obama stimulus? Maybe good, maybe not so good. But it was happening at the same time as we had changing monetary and regulatory policy. Or take the 1981 Reagan tax cuts. Was their biggest impact on the 1980s or on the 1990s? And were those impacts different? Maybe they boosted demand in the 1980s with the supply-side effects taking longer to develop.

2) There have been a dozen presidents since World War II. Is that a huge sample size, especially given changing demographics and macroeconomic conditions?

3)  Luck matters. Here is the FT’s Gideon Rachman on the Clinton Boom:

The Soviet Union had collapsed in 1991, just a year before Mr. Clinton was first elected. Throughout his eight years as president, there was no serious competitor to the US for the role of global superpower. … The name Osama bin Laden had yet to impinge on the public consciousness. …Mr Clinton’s economic inheritance was similarly golden. The frightening deficits of the Reagan years disappeared in the 1990s, partly because of sensible fiscal decisions taken by President George HW Bush. By the time Mr Clinton took office, the US economy was already recovering strongly. He was the lucky beneficiary of a surge in American productivity, following the transformation of the workplace by computers. With unemployment at just 4 per cent and inflation under control, there was exuberant talk of a “New Economy”. Given this fortunate combination of circumstances, is it any wonder that the president had time for dalliances in the Oval Office?

4)  Does partisan labeling really reveal policy, especially as parties evolve over the decades? Many conservatives have attached themselves to the policies of Democrats JFK (big tax cuts) and Clinton (free trade, balanced budgets, investment tax cuts) and rejected those of Republicans Richard Nixon and George H. W. Bush. As I have written:

In a 2008 WSJ piece, investment strategist Donald Luskin noted that since 1948, the total return of the S&P 500 had averaged 16% with a Democrat in the White House and 11% with a Republican. But swap Clinton and JFK for Nixon and Bush I, and you find that the market is up an average of 15% under the GOP and 11% under the Dems.

 

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RIP Fred Thompson

Fred Thompson, senator, actor, lawyer, radio host and, yes, former AEI visiting fellow, passed away on Sunday at 73.

Former senator Fred Thompson speaking at AEI in 1999.

There will be encomia aplenty for Thompson, whose peripatetic career fitted a man of wide interests and talents. Most who knew him will recall his larger than life personality, his sonorous voice, his wry humor. But he was a clear and principled thinker as well, which is why we welcomed him at AEI.

Consider this warning, delivered in a speech at AEI in April, 2004, which still resonates so strongly to this day:

… these predictions of defeat have profound consequences in the real world. In every war, military historians will tell you, that there is a strategic center of gravity, a tipping point that determines in what direction the larger conflict will go. The strategic center of gravity for this war is American willpower.

Our enemies know this. They know that they cannot defeat us in any conventional military contest, so instead their aim is to demoralize us and to shake our resolve. They know that their only hope is gruesome, made-for-television atrocities to undermine the confidence of the American public. Their purpose is not even to win, but to convince us that we cannot win, to break our will, to convince us to cut and run.

From the AEI family to the Thompson family he so loved, our condolences.

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Budget deal & DoD spending: Eaglen on Defense News TV’s ‘Defense News with Vago Muradian’

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Academia’s Rejection of Diversity

This column was originally published on October 31, 2015 in The New York Times.

ONE of the great intellectual and moral epiphanies of our time is the realization that human diversity is a blessing. It has become conventional wisdom that being around those unlike ourselves makes us better people — and more productive to boot.

Scholarly studies have piled up showing that race and gender diversity in the workplace can increase creative thinking and improve performance. Meanwhile, excessive homogeneity can lead to stagnation and poor problem-solving.

Unfortunately, new research also shows that academia has itself stopped short in both the understanding and practice of true diversity — the diversity of ideas — and that the problem is taking a toll on the quality and accuracy of scholarly work. This year, a team of scholars from six universities studying ideological diversity in the behavioral sciences published a paper in the journal Behavioral and Brain Sciences that details a shocking level of political groupthink in academia. The authors show that for every politically conservative social psychologist in academia there are about 14 liberal social psychologists.

Why the imbalance? The researchers found evidence of discrimination and hostility within academia toward conservative researchers and their viewpoints. In one survey cited, 82 percent of social psychologists admitted they would be less likely to support hiring a conservative colleague than a liberal scholar with equivalent qualifications.

This has consequences well beyond fairness. It damages accuracy and quality. As the authors write, “Increased political diversity would improve social psychological science by reducing the impact of bias mechanisms such as confirmation bias, and by empowering dissenting minorities to improve the quality of the majority’s thinking.”

One of the study’s authors, Philip E. Tetlock of the University of Pennsylvania, put it to me more bluntly. Expecting trustworthy results on politically charged topics from an “ideologically incestuous community,” he explained, is “downright delusional.”

Are untrustworthy academic findings really a problem? In a few high-profile cases, most definitely. Take, for example, Prof. Diederik Stapel of Tilburg University in the Netherlands, who in 2011 faked experiments to show, among other things, that eating meat made people selfish. (He later said that his work was “a quest for aesthetics, for beauty — instead of the truth”).

This kind of ideologically motivated fraud is mercifully rare. As a social scientist working in universities and think tanks, I have never met a colleague who I believe has engaged in this sort of misconduct.

But even honest researchers are affected by the unconscious bias that creeps in when everyone thinks the same way. Certain results — especially when they reinforce commonly held ideas — tend to receive a lower standard of scrutiny. This might help explain why, when the Open Science Collaboration’s Reproducibility Project recently sought to retest 100 social science studies, the group was unable to confirm the original findings more than half the time.

These concerns aren’t a modern innovation. In one classic experiment from 1975, a group of scholars was asked to evaluate one of two research papers that used the same statistical methodology to reach opposite conclusions. One version “found” that liberal political activists were mentally healthier than the general population; the other paper, otherwise identical, was set up to “prove” the opposite conclusion. The liberal reviewers rated the first version significantly more publishable than its less flattering twin

The World Bank has found a similar phenomenon at work among its own staff. In a recent exercise, the organization presented identical data sets to employees under two different pretexts. Some employees were told the data were measuring the effectiveness of a skin rash cream, while others were told the same data measured the effects of minimum wage laws on poverty. The politicized context of the second question led to more erroneous analyses, and the accuracy of left-leaning respondents plummeted when the data conflicted with their worldview.

Improving ideological diversity is not a fundamentally political undertaking. Rather, it is a question of humility. Proper scholarship is based on the simple virtues of tolerance, openness and modesty. Having people around who think differently thus improves not only science, but also character.

Many academics and intellectuals see their community as a major force for diversity and open-mindedness throughout American society, and take justifiable pride in this image. Now they can be consistent and apply those values to their own profession, by celebrating ideological diversity.

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Stocks and the Clinton effect

This article appears in the November 2, 2015 issues of National Review.

Financial markets look to the future when pricing assets. If a 50 percent chance emerges that a company will be worthless tomorrow, the price drops 50 percent today. Accordingly, elections can be a time of great valuation stress for those in the crosshairs of candidates. If a candidate with a real chance of victory announces a policy harmful to a specific set of companies, the damage can be significant.

Drug companies research drugs for many years, and occasionally find a winner that can be marketed to consumers. The prices for the few drugs that are ultimately sold to the public are high, as they must be to provide a positive return for all research and development (including the many cases in which it leads to failure). This approach has been an astonishing success in the U.S., and new and innovative drugs for HIV, cancer, and other significant maladies have emerged from the for-profit sector in recent decades.

The high prices of the drugs that make it to market are nonetheless a regular target of progressives, who seem to presume either that private companies will spend billions on drug discovery without a profit incentive or that academic researchers are responsible for all the major breakthroughs. Neither presumption is correct.

On September 21, the Clinton campaign rolled out a plan to “hold the pharmaceutical industry accountable and rein in drug costs.” “This isn’t a new fight for her. She fought against special interests for affordable health coverage in the 1990s,” her campaign website asserts. Indeed, then as now, the Clintons took aim at the pricing of pharmaceutical drugs. For instance, in December 1992, the New York Times wrote that then-president-elect Bill Clinton pledged to “stop drug price gouging” by eliminating tax breaks for companies that raised drug prices by more than inflation as measured by the Consumer Price Index.

In just the five days following her September 21 announcement of her renewed interest in putting a ceiling over the price of pharmaceutical drugs, the S&P Pharmaceutical Industry Index tumbled as much as 6.4 percent. Media accounts widely linked the decline to Clinton’s proposal.

The Clintons’ first pass at bashing this industry attracted the attention of the peer-reviewed economics literature. An April 2001 article in the Journal of Law and Economics, “Gradual Incorporation of Information: Pharmaceutical Stocks and the Evolution of President Clinton’s Health Care Reform,” used sophisticated statistical techniques to assess the impact of the first Clinton effort. Its authors, Sarah Ellison and Wallace Mullin, attribute market-adjusted pharmaceutical-share-price declines of over 50 percent to the Clinton policy push.

You do not need sophisticated analysis, however, to see the negative effect that the Clintons’ 1990s campaign had on pharmaceutical share prices. The nearby chart shows the cumulative decline in the S&P Pharmaceutical Industry Index for every day of U.S. stock-market trading between what Ellison and Mullin identify as the “opening round” of the Clinton pharmaceutical push on January 19, 1992, and the death of the Clinton health-care-reform bill in Congress on July 21, 1994. The cumulative decline during the period is measured relative to the index price on January 17, 1992, the last day of U.S. stock trading before Clinton’s initial announcement. The first day of U.S. stock trading after that announcement—January 20—is day “0” on the chart, which on its horizontal axis shows the number of trading days that have elapsed since January 19. For context, the dotted bar marks the start of the Democratic national convention that would nominate Bill Clinton for the presidency, and the solid bar marks the Election Day that would make him president.

As you can see, the “Clinton effect” on the pricing of pharmaceutical shares is enormous. It reached a whopping –34.8 percent in August 1993. Meanwhile, the S&P was up about 7 percent over the same period. Even by the saga’s end in July 1994, the cumulative effect was –28.8 percent, compared with the S&P’s +8.1 percent. It wasn’t the whole market that tanked—it was the sector that the president ofthe United States and his wife had in their sights. The S&P pharmaceutical index didn’t regain its value until May 3, 1995. The Clintons’ chatter removed billions of dollars from innovative companies, and probably significantly reduced progress towards cures for numerous diseases.

The S&P pharmaceuticals index has for the moment recovered the losses it suffered after Hillary’s statement this September. But the Nineties episode happened when a “New Democrat” was trying to wean his party from its insistence that the era of big government should continue. One can only wonder how bad it will get this time, as Mrs. Clinton proposes anti-corporate policies in an attempt to compete with socialist Bernie Sanders.

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Our poverty data may be completely wrong

The United States federal government spends about $236 billion per year on programs for low-income populations, not counting health insurance. That’s roughly $2,000 per American household. Yet some criticize the American safety net as inadequate, citing increases in deep poverty (defined as less than 50 percent of the official Federal Poverty Level) or those “disconnected” from government assistance. But a new study shows that some statistics on poverty are dramatically overstated because of flawed survey data. This should change how we view the poor in the United States and the programs that serve them.

According to the study, by University of Chicago researchers Bruce Meyer and Nikolas Mittag, survey respondents in deep poverty reported only 52 percent of government resources they received. Considering all people in poverty, survey data captured only 46 percent of government assistance. The implication was that poverty researchers — who often recalculate the poverty rate to include income from programs that the official metric ignores — have been reporting bad numbers. Using this type of measure, with the thresholds from the official metric but more safety-net income included, single-mother households had a poverty rate of 30.2 percent using the survey data, but only 19.2 percent once underreporting was accounted for.

A much smaller percentage of single mothers were also found to “fall through the cracks” completely when factoring in underreporting. Past research suggests that roughly 20 percent of single mothers had no earnings and no income from cash welfare, suggesting that government programs were failing them. But Meyer and Mittag found that relying on survey data overstated the percentage of these “disconnected” single mothers by one-third.

The researchers discovered this phenomenon by looking at data from New York State, comparing what individuals told the Census’s Current Population Survey with data from state agencies indicating what they actually received in cash, food, housing, and other benefits. Based on their analysis, the authors believe that the results are applicable outside of New York State, and that the data flaws are likely consistent across most household surveys.

These results require that we reassess our view of the poor and the programs designed to serve them. An analysis in the recent book $2 a Day: Living on Almost Nothing In America, by Kathryn Edin and Luke Shaefer, found that 1.5 million households were living on less than $2 in cash a day in 2011 — a number that almost doubled since welfare reform in 1996. They argued that TANF, the government’s safety net of last resort, was dead. But is that number real? The work by Meyer and Mittag suggests it is likely not.

What does this mean for policy? First, reexamining the reach of government safety-net programs with misreported survey data in mind is needed. Some research does this, but few studies link survey and administrative data at the individual level as Meyer and Mittag did. Doing this at a national level will likely show that the safety net is much stronger than previously thought. Policymakers might have very different conversations about safety-net programs if they are shown to have larger poverty-reducing effects.

Second, researchers should reconsider conducting analyses that rely on flawed Census data. Unfortunately, this means that our understanding of program participation and recipient characteristics might be severely limited. But limited knowledge may be better than flawed knowledge, especially when billions of federal dollars are at stake.

Finally, access to better data is needed. This means more efforts to improve the quality of survey data, as well as increased access to linked survey and administrative data. Interest among academics and policymakers in alleviating poverty is strong. But continuing to rely on flawed data won’t help people in poverty, and might even harm them if it takes us in the wrong direction.

Angela Rachidi is a research fellow in poverty studies at AEI, where she studies the effects of public policy and existing support programs on low-income families.

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Sunday morning links

1. Venn Diagram of the Day inspired by Arthur Brooks’s op-ed in the NY Times “Academia’s Rejection of Diversity,” here are a few key sentences:

New research shows that academia has itself stopped short in both the understanding and practice of true diversity — the diversity of ideas — and that the problem is taking a toll on the quality and accuracy of scholarly work.

…..

Many academics and intellectuals see their community as a major force for diversity and open-mindedness throughout American society, and take justifiable pride in this image. Now they can be consistent and apply those values to their own profession, by celebrating ideological diversity.

MP: If you read some of the 800+ comments, you’ll find a lot of people who are not keen on celebrating ideological diversity, confirming much of what Arthur writes about in his op-ed.

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2. Chart of the Day I (above). The EIA released new data this week showing that America’s net petroleum imports fell below 25% this year (through September) for the first time since 1971. What accounts for the lowest dependence on foreign sources of petroleum in 44 years? It’s not because of any centrally planned government policy in Washington like the Renewable Fuel Standard program, or taxpayer subsidies of other renewable energies. America is more energy secure today than any time since the early 1970s thanks to the old-fashioned American free-market ingenuity that unlocked our country’s abundant shale resources.

3. On Energy Security, Obama Should Follow David Cameron’s Example, that’s the title of my op-ed in the Washington Examiner, here’s a slice:

Less than a decade ago U.S. energy security was in crisis. Domestic oil production had been declining steadily from a peak of 10 million barrels per day in 1970 to only half that amount in 2005. Our reliance on oil imports and OPEC had risen to an all-time high ten years ago. U.S. natural gas production had been flat for more than 30 years and was slipping behind growing domestic demand. We were on track to become a major natural gas importer, a future that energy experts the world over agreed was nearly inevitable.

Despite countless promises about breaking — or at least significantly reducing — our reliance on overseas energy sources, our energy security was going from bad to worse. Fortunately, innovation, “petropreneurship” and free market capitalism had other plans.

The oil and gas industry’s “Thank You” from the president for the most remarkable energy success story in U.S. history? Try new regulations governing hydraulic fracturing on federal lands, newly proposed methane and ozone regulations, blocking the Keystone XL pipeline and the threat of a veto to block any legislation that would lift the crude export ban.

4. Seattle’s $15 Minimum Wage (Economic Death Wish): “No matter how it ends up happening, it will be a detriment to the community and the city,” writes Clinton Alexander, who lives and works in the Seattle area and has managed and advised small family businesses for 20 years. Here’s the conclusion of his article “Seattle’s Coming $15 Minimum Wage“:

As voices cry ever louder for an increased federal minimum wage, the stories of small businesses across the nation need to be brought into the spotlight — businesses reaching out to unskilled youth willing to put in time training. Companies managing a tight bottom line can’t handle the extra expense of yet another increase in wages.

The heart of our nation does not lie within the halls of Congress but rather in the bakeries, pizza shops, recycling centers, and myriad other small businesses. It is not in the backroom deals between politicians where the effects of these laws will be felt, but rather in the checking accounts of struggling businesses.

5. Great Moments in Excessive Government Regulation: In Iowa, braiding hair without a permission slip from the government (cosmetology license) is a crime, punishable by up to one year in prison and civil fines as high as $10,000. Thankfully, the Institute for Justice just filed a civil rights lawsuit against the Iowa Board of Cosmetology Arts & Sciences on behalf of two hair braiders, see Forbes article here and Des Moines Register editorial here.

Thanks to the ongoing legal advocacy efforts of the Institute for Justice on behalf of small businesses and entrepreneurs, economic freedom in America gets a little better every time IJ wins a case, let’s hope they prevail again this time in Iowa.

6. Government As a Protection Racket.  From Kevin Williamson’s National Review article “The Public Sector: Standing in Our Way until We Pay Up“:

When it comes to government, if you aren’t involved in the provision of actual public goods, you are involved in extortion. It may be legal. It may have the blessing of the mayor, the city council, and your union representative, but it’s still extortion. And you should be ashamed of yourself. If your only purpose is getting in the way until somebody hands you money, then you are part of a protection racket. And you might want to think about going into a more honorable line of work.

7. Picketty Gets it So Wrong: 69% of the 2015 Forbes 400 are self-made, up from less than 50% in 1984:

This year, we gave each member of The Forbes 400 a score on a scale from 1 to 10 — a 1 indicating the fortune was completely inherited, while a 10 was for a Horatio Alger-esque journey.  We also did the analysis for every 10 years going back to 1984. Looking at the numbers over time, the data lead us to an interesting insight: in 1984, less than half of people on The Forbes 400 were self-made; today, 69% of the 400 created their own fortunes.

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8. Chart of the Day II (above). The six-fold increase in corn yields from an average of 27 bushels per acre between 1886 to 1950 to 171 bushels per acre last year and an estimated 167.50 bushels per acre this year.

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9. Chart of the Day III (above). We hear a lot about stagnant US wages, but real personal income tells a much different story of above-average growth. According to data released Friday by the BEA, real personal income increased by 3.9% in September compared to the same month a year ago, marking the 12th straight month of above average growth (3.27% from 1960 to 2015). The last time there were 12 straight months of above average growth was in 2006, and the last time before that was a 19-month period from 1999-2001 at the end of the longest economic expansion in US history.

10. Video of the Day (below). “Daylight Saving” movie trailer.

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Obama’s incoherent Syria strategy

President Barack Obama announced Friday that as many as 50 US Special Forces troops would deploy to Syria to assist Kurdish forces fighting against the Islamic State of Iraq and Syria. This is a minor tweak to an incoherent strategy doomed to fail, and is a pitiful response to fundamental changes in the situation on the ground wrought by the deployment of Russian and Iranian forces to support Syrian President Bashar al-Assad.

Simply put, Friday’s announcement shows that the administration remains befuddled about the nature of this war.

The White House precluded any realistic appraisal of the situation in Syria from the outset of its military involvement by defining the problem and the enemy almost exclusively as ISIS. It has thereby ignored almost completely the actual al Qaeda franchise in Syria, Jabhat al Nusra, which has been insinuating itself into the good graces of the fighting opposition for years now. It has also refused to properly recognize Assad himself as a major problem, let alone an enemy, aside from periodic rhetoric.

The real problem is the vicious sectarian war in Syria that has killed hundreds of thousands and driven millions from their homes. Assad started that war by attacking his own peaceful protesters, and he has steadily escalated the brutality by using conventional and chemical weapons against his own people, deliberately starving large populations, and dropping barrel bombs on civilian targets to create mass casualties.

Assad’s sectarian viciousness, and the collapse of his ability to govern, created both space and motivation for the emergence and enormous strengthening of Jabhat al Nusra and ISIS. His actions, now reinforced by Iranian ground forces and Russian aircraft that are also bombing civilian areas, perpetuate the cycle of sectarian escalation that fuels the growing strength of the most radical Sunni elements on the battlefield.

Yet the Obama administration refuses to support any action against him. It reportedly forbade the small groups of volunteers who signed up for training against ISIS to use their weapons or capabilities against Assad. It has taken no action (speeches are not action) to limit Russian activities in support of Assad, let alone persuade Vladimir Putin to abandon this unprecedented Russian military venture into the Middle East. Not only has it done nothing to prevent or disrupt Iranian military and nonmilitary support to Assad, but it has now invited Iran to the negotiating table. The United States has a rhetorical policy of opposing and removing Assad, but a practical policy of keeping him in power.

The focus on ISIS and refusal to consider any other aspect of the conflict helps the White House obscure this contradiction from all except those who matter most — the people on the ground.

The Syrian opposition knows that we are not really supporting them against Assad, the enemy they most care about, while demanding that they fight ISIS, the enemy that right now threatens them least. The Sunni Arab population, therefore, has not provided the indigenous forces on which the White House claims that its strategy against ISIS relies, for excellent and logical reasons.

So the White House has turned to Syria’s Kurds. But relying on Kurds to drive ISIS out of Arab lands is problematic for many reasons, among them the high risk of adding an Arab-Kurd ethnic conflict to the brutal sectarian war already raging.

The Turks suspect the Kurds of being closely tied to the PKK, a terrorist group that regularly attacks targets in Turkey. They are also much less readily controlled than Iraq’s Kurds, who have more than two decades of experience in governing themselves at this point (although they are themselves in the midst of a governmental crisis that threatens to unravel Kurdish stability in Iraq).

So while we might be able to help Syrian Kurds expel ISIS from parts of its dominion with a lot of air power, guided by Special Forces troops, and a lot of luck, what then? Will the Kurds hold and govern the Arab lands they have “liberated”? Will they drive down the Euphrates to take the other key ISIS strongholds? Will the Turks watch calmly as a group that they believe sponsors terrorist attacks in their homeland expands its military power and strategic depth?

Even from the standpoint of fighting ISIS, this over-reliance on the Kurds is short-sighted, and represents a desperate effort to grasp at any on-the-ground proxy who can make progress toward the President’s stated goals before he leaves office. It is not in any way strategic.

Criticizing anyone’s strategy in Syria is, of course, much easier than offering an alternative. The situation is now beyond dire and all anyone can do is offer first steps that might start to drive it in a more positive direction. But any such steps must begin from the understanding of what this conflict is really about and who must actually resolve it: the Sunni Arabs and the non-Assad Alawite community. Those are the groups that will have to decide to put down their weapons and work out a mutually-acceptable deal. Defeating ISIS will still be hard in that context, but at least it might be both feasible and meaningful.

We don’t need 50 Special Forces troops in Syria to help the Kurds. We need an entirely new strategy. It must start with the recognition that Assad, and his regime, really do have to go; that the United States and its allies must work actively to constrain and reduce Iranian and Russian support for him; that we have to reach out to the Sunni Arab population and convince them that we are on their side against the existential threat they face before demanding that they fight the enemy we want them to fight; and that the Sunni Arabs are the people amongst whom we need to embed our forces and with whom we need to work.

It may be that no such strategy can succeed any longer. It is certain that any other approach will fail.

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